Maine and eight other Northeast and Mid-Atlantic states that participate in the nation's first market-based cap-and-trade program known as the Regional Greenhouse Gas Initiative, or RGGI, have agreed to further restrictions on carbon emissions from power plants. The coalition has agreed to cut emissions: from 165-million tons down to 91-million tons, or 2012 levels. Environmental groups welcomed the news. But as Susan Sharon reports, there is also concern that the LePage administration's support for RGGI is contingent on other major changes to the program.

Just two years ago, the LePage administration was talking about opting out of the Regional Greenhouse Gas Initiative, or RGGI, a program that has spurred more than $1.6 billion in economic growth, reduced climate change pollution, lowered energy bills by about 10 percent and created 16,000 jobs across the region, according to an independent analysis.

Now, Maine and the other participating states have agreed to cut global warming pollution 45 percent beginning in 2014, and an additionoal 2.4 percent each year until 2020. But Maine's support comes with a catch: Department of Environmental Protection Commissioner Patty Aho says the governor wants to use revenues generated by the cap-and-trade program to help reduce electricity rates and residential heating costs.

"Otherwise, if we're not able to provide and re-focus those proceeds, then there may not necessarily be the help from this program that we think is critical in helping to support becoming more energy efficient here in Maine," Aho says.

Currently, the way the program works is that power plants must buy permits or allowances for each ton of carbon dioxide they emit. Revenue from the sale of these allowances is then reinvested in energy efficiency programs that help reduce costs for businesses. The money is administered by the Efficiency Maine Trust which has used it to help paper mills and other large energy consumers save energy, reduce pollution, and in some cases, even protect jobs.

But state energy director Patrick Woodcock says the governor now sees RGGI as an opportunity to address some of the economic barriers facing Maine: high electricity rates and the high cost of home heating oil. And he's working on legislation that would allocate RGGI auction revenues for that purpose.

"You know, what we're going to allow is customers to decide what their best option is," Woodcock says. "Efficiency is a great route for a lot of homes, especially in Maine that has some of the oldest housing stock; also natural gas, propane, wood pellets, are terrific options."

While environmental groups are pleased with the steps Maine and the other states are taking to reduce carbon emissions from power plants, they are also concerned about what diverting some of the funding away from energy efficiency programs will mean for the future of RGGI.

"Key to the success of the program, the fact that the revenue generated from selling pollution credits has been invested in energy efficiency," says Emily Figdor, director of the group Environment Maine. "And it's critical that the revenue from the program continue to be invested in energy efficiency. That's what's going to lower energy bills, not only now, but year after year in the future."

Among the Maine businesses that have benefitted from RGGI: Madison Paper, Moose River Lumber, National Semiconductor and Jackson Labs. And Greg Cunningham of the Conservation Law Foundation says the LePage administration is misguided if it thinks siphoning away revenues from energy efficiency programs is a good strategy.

"To remove those programs and somehow allocate them in some other manner is risky," Cunningham says. "It's potentially irresponsible, and it's ignoring the fact that there is already a program in place by which we essentially pay for energy at three cents a kilowat hour. And we simply can't replicate that in any other program."

But Patrick Woodcock of the governor's energy office says the problem has been that most Mainers can't afford to invest in cleaner energy options. The governor's bill is designed to give them more flexibility. He expects the legislation to be unveiled in the next month.